MIAMI - The
United States and Chile today signed an historic and cutting-edge Free Trade
Agreement (FTA) that when fully implemented eliminates bilateral tariffs, lowers
trade barriers, promotes economic integration and expands opportunities for the
peoples of both countries. U.S. Trade Representative Robert B. Zoellick signed
on behalf of the United States, and Chilean Foreign Minister Soledad Alvear
signed for Chile, at the Vizcaya Museum and Gardens in Miami. The U.S.- Chile
FTA is the first free trade agreement between the United States and a South
American country.

"This is an
historic agreement that sets a high benchmark for future FTAs. I'm honored to
represent President Bush, whose leadership and convictions have helped to
restore American trade and economic leadership," said Zoellick. "This state of
the art agreement slashes tariffs and quotas, reduces barriers for services,
protects leading-edge intellectual property, keeps pace with new technologies
and new ways of doing business, ensures regulatory transparency, and promotes
labor and environmental protections."

"American
farmers, workers, consumers and businesses will benefit from improved access to
the Chilean market, and this FTA will provide momentum to the ongoing
negotiations in the Free Trade Area of the Americas and the global trade talks,"
said Zoellick. "I want to thank Minister Alvear for her leadership in completing
this FTA. I also want to recognize Governor Jeb Bush and the people of Miami and
Florida for their commitment to trade and their hospitality today."

Florida Governor
Jeb Bush provided welcoming remarks at the ceremony, and was joined by local
elected leaders from the City of Miami and Miami-Dade County.

The U.S.-Chile
FTA will increase U.S. market access for goods and services and provide strong
protections for U.S. investors in Chile. American workers, consumers,
businesses, and farmers will enjoy preferential access to one of the world's
fastest growing economies, enabling products and services to flow back and forth
from the United States and Chile with no tariffs and under streamlined customs
procedures.

Zoellick noted
that he was especially proud to be signing the Chile FTA, because it has been a
focus of his throughout his tenure. Zoellick's first overseas trip as USTR was
to Chile, in April 2001, where he gave a speech before the Chilean-American
Chamber of Commerce in Santiago.

Some of the key
opportunities the FTA provides for are:

New Opportunities for U.S.
Workers and Manufacturers - More than 85 percent of bilateral trade in
consumer and industrial products becomes tariff-free immediately, with most
remaining tariffs eliminated within four years. Key U.S. export sectors benefit,
such as agricultural and construction equipment, autos and auto parts, computers
and other information technology products, medical equipment, and paper
products.

Expanded
markets for U.S. Farmers and Ranchers- About three-quarters of
both U.S. and Chilean farm goods will be tariff-free within four years, with all
tariffs and quotas phased out within 12 years. U.S. farmers' access to Chilean
markets will be as good or better than the European Union or Canada, both of
which already have FTAs with Chile. Without this agreement U.S. farmers face
higher tariffs than farmers from Canada or the EU. Farmers will gain duty-free
treatment within four years for important U.S. products such as pork and pork
products, beef and beef products, soybeans and soybean meal, durum wheat, feed
grains, potatoes, and processed food products such as french fries, pasta,
distilled spirits and breakfast cereals.

A Trade
Agreement for the Digital Age - State-of-the-art protections and
non-discriminatory treatment are provided for digital products such as U.S.
software, music, text, and videos. Protections for U.S. patents, trademarks and
trade secrets exceeds past trade agreements in the region.

Strong
Protections for U.S. Investors - The Agreement establishes a secure,
predictable legal framework for U.S. investors in Chile.

Open and
Fair Government Procurement - Provides for ground-breaking
anti-corruption measures in government contracting. U.S. firms are guaranteed a
fair and transparent process to sell goods and services to a wide range of
Chilean government entities, including airports and seaports.

Two-way trade in
goods (exports plus imports) between the United States and Chile totaled $6.4
billion in 2002. Two-way trade in services in 2001 (latest year available)
amounted to $2.2 billion. Since 1994, U.S. goods trade with Chile has expanded
by 39% (to 2002) and services trade by 37% (to 2001).

Upon
Congressional approval of this Free Trade Agreement, 85 percent of industrial
products will be traded without duties. In less than four years, 75 percent of
farm production will also be freely traded. After just ten years, all trade in
non-agricultural goods will take place without tariffs or quotas; for
agriculture, the phase out will take just 12 years.

Background:

The United States
and Chile began bilateral negotiations on an FTA in December 2000, holding a
series of 14 negotiating rounds, with teams of specialists alternating between
Santiago, Chile and cities in the United States, including Miami, Atlanta and
Washington, DC. During the final round held in December 2002, over 90 Chilean
and 140 U.S. negotiators representing 19 U.S. agencies worked for nine straight
days to complete the agreement.

Technical work on
the text continued up through the week of signing with legal teams from both
countries reviewing and clarifying the text. After signing the agreement the
next step is for the President to submit to Congress a description of the
changes to existing U.S. law that would be required to bring the United States
into compliance with its obligations under the agreement, within sixty days
after the agreement is signed. After the agreement is signed, the International
Trade Commission (ITC) will report to the President and to Congress on the
impact the agreement will have on U.S. industrial sectors and the economy as a
whole.

After working
with the Congress to draft implementing legislation, the President will submit
the agreement to Congress for approval, along with an implementing bill, a
description of administrative changes needed to carry out the agreement, and
other supporting documentation. Once submitted, the House and Senate will review
the implementing package and vote under an expedited timetable.

The United States
currently has four free trade partners: Canada and Mexico (within NAFTA);
Israel; and, Jordan. An FTA with Singapore was recently signed, and along with
the Chile FTA must also be approved by Congress before it can take
effect.

The United States
has begun FTA negotiations with Morocco; five nations in Central America (CAFTA,
which includes Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua);
five nations in the Southern African Customs Union (Botswana, Lesotho, Namibia,
South Africa and Swaziland); and Australia.

A center for
regional trade, Miami is hosting the Free Trade Area of the Americas Ministerial
in November 21-23, 2003. Miami was the site of the 1994 Summit of the Americas,
where the idea of the US-Chile FTA was first discussed.